Private Enterprise Federation, PEF has raised concerns over government's inability to establish an asset recovery institution to deal with nonperforming loans.
According to the Chief Executive Officer for PEF, Nana Osei Bonsu an asset recovery institution was one of the recommendations they made as industry players to the government in 2017.
Nana Osei Bonsu said a recovery institution will ensure banks are not burdened with bad loans.
His comments come on the back of the rising cost of the financial sector cleanup. According to reports the financial sector clean up is likely to reach GH¢21 billion by close of this year.
Speaking to Joy FM, Nana Osei Bonsu said the banking sector clean up is a good step but other sectors of the financial structure must also be addressed to prevent the collapse of businesses.
"Private Enterprise Federation hosted a the President-elect to tell us what he has for the future of the private sector, in that report that I actually read on behalf of the industry we told the asked and requested the President to set up an asset recover institution to take away all these..... portfolios of nonperforming loans from the banking sector clean them up and leave them clean to do their business, we offered that because we knew what was happening but that has not happened now later on down the road we bring different receivers, do they have the capacity? were they part of the system? the auditors, the accountants and all these are part of the same group that are being asked to be the receivers of these institutions so we haven't done what need to be done because we had a pre-notice that the things in the system were not working right and they are ways that.. asset recovery is not a new thing setting aside, buying down the nonperforming loans which may amount to 10% discounted or 20% it can be done, but the efforts in the banking sector are in the right direction no two ways about that but the other part of the financial sector is what needs to be done because unless we do that......do the banking and then the saving and loans and asset managers coming to a point where peoples businesses will collapse "
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